01Facts
The petitioners, existing liquor licensees in Rajasthan, challenged the constitutional validity of Clauses 2.2.6, 2.2.7, and 2.2.8 of the Rajasthan Excise & Temperance Policy 2025–2029.
¶ 3.1, 3.6The new policy introduced a "cluster" system where shops were grouped (1–5 shops) for settlement.
¶ 3.1Under the impugned clauses, renewal of an individual license was made conditional upon: (a) at least 70% of eligible licensees in the district applying for renewal, and (b) all shops within a specific cluster applying for renewal.
¶ 3.3If these conditions were not met, the shops were subjected to e-auction.
¶ 3.3The petitioners, despite fulfilling individual eligibility and paying fees, had their renewals cancelled/non-considered because other shops in their respective clusters remained unrenewed or the district threshold was not met.
¶ 3.5, 4.3.102Issues
i.Whether Clauses 2.2.6, 2.2.7, and 2.2.8 of the Excise Policy 2025-2029 are arbitrary and violative of Article 14 of the Constitution by making an individual’s renewal contingent on the actions of third parties.
¶ 3.6, 4.3ii.Whether a citizen has a fundamental or vested right to the renewal of a liquor license under the Rajasthan Excise Act, 1950.
¶ 5.2, 6.3.103Law Applied
The Court applied the principle that there is no fundamental right to trade in liquor under Article 19(1)(g), as liquor is res extra commercium, establishing that the State holds "exclusive privilege" over its regulation.
¶ 6.3.1This was based on the precedent in Khoday Distilleries Ltd. v. State of Karnataka (1995).
¶ 4.2.1, 6.3.2Furthermore, the Court invoked Section 37 of the Rajasthan Excise Act, 1950, which explicitly states that no person has a claim to the renewal of a license.
¶ 5.2, 6.5.3While State action must not be "manifestly arbitrary" under Article 14, the Court noted that Article 47 (Directive Principles) mandates the State to endeavor toward prohibition, further strengthening State regulatory powers.
¶ 6.2, 6.3.3Provisions in the judgment · 1 · Linked ones open on LawLens
rajasthan excise act, 1950 Section 37
04Reasoning
The Court reasoned that the "cluster" mechanism and the 70% district-wide threshold are policy decisions aimed at revenue optimization, administrative efficiency, and preventing "fallow" unregulated areas.
¶ 5.3, 6.3.4, 6.4.1It held that the State is entitled to adopt collective settlement mechanisms to secure revenue and uniformity, and the linked nature of renewals does not equate to "manifest arbitrariness."
¶ 6.4.2The court emphasized that formulation of excise policy involves complex fiscal considerations where judicial interference is minimal unless there is "hostile discrimination," which the petitioners failed to prove.
¶ 6.3.4, 6.7Furthermore, the Court noted that the petitioners had submitted renewal applications after accepting the policy's terms, thereby attracting the principle of estoppel—they could not challenge the conditions once the outcome became unfavorable.
¶ 5.7, 6.6.2, 6.6.305Holding
The Court answered both issues in the negative, holding that the impugned clauses are neither arbitrary nor discriminatory as they apply uniformly across the State.
¶ 6.7It ruled that the petitioners have no fundamental or vested right to renew their licenses.
¶ 6.3.1, 6.5.3Consequently, the High Court dismissed the entire batch of writ petitions, upholding the validity of the Rajasthan Excise & Temperance Policy 2025–2029 and the State’s right to conduct e-auctions for the disputed clusters.
¶ 7Original Court PDF
Jamana W/o Jetha Ram v. State of Rajasthan & Ors. [2026:RJ-JD:9742-DB]
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